1. Lecture#5 Consumer Markets and Consumer Buyer Behavior

2. Name the four major factors that influence consumer buyer behavior.
Lecture objectives
Define the consumer market and construct a simple model of consumer buyer behavior.
Name the four major factors that influence consumer buyer behavior.
List and define the major types of buying decision behavior and the stages in the buyer decision process.
Describe the adoption and diffusion process for new products.
In the previous lecture, you studied how marketers obtain, analyze, and use information to develop customer insights and assess marketing programs. In this lecture and the next, we continue with a closer look at the most important element of the marketplace—customers. The aim of marketing is to affect how customers think and act. To affect the whats, whens , and hows of buyer behavior, marketers must first understand the whys. In this lecture, we look at final consumer buying influences and processes. In the next time, we’ll study the buyer behavior of business customers. You’ll see that understanding buyer behavior is an essential but very difficult task. To get a better sense of the importance of understanding consumer behavior, we begin by first looking at Apple. What makes Apple users so fanatically loyal? Just what is it that makes them buy a Mac computer, an iPod, an iPhone, an iPad, or all of these? Partly, it’s the way the equipment works. But at the core, customers buy from
Apple because the brand itself is a part of their own self-expression and lifestyle. It’s a part of what the loyal Apple customer is.

3. Consumer market
All the individuals and households that buy or acquire goods and services for personal consumption.
Focal point - Основные моменты
Foe – враг, противник
Stimuli – стимул, побудитель

4. Consumer buyer behavior
The buying behavior of final consumers individuals and households that buy goods and services for personal consumption.
Consumers around the world vary tremendously in age, income, education level, and tastes. They also buy an incredible variety of goods and services. How these diverse consumers relate with each other and with other elements of the world around them impacts their choices among various products, services, and companies. Here we examine the fascinating array of factors that affect consumer behavior.

5. We can measure the whats, wheres, and whens of consumer buying behavior. But it’s very difficult to “see” inside the consumer’s head and figure out the whys of buying behavior (that’s why it’s called the black box). Marketers spend a lot of time and dollars trying to figure out what makes customers tick.
Consumers make many buying decisions every day, and the buying decision is the focal point of the marketer’s effort. Most large companies research consumer buying decisions in great detail to answer questions about what consumers buy, where they buy, how and how much they buy, when they buy, and why they buy. Marketers can study actual consumer purchases to find out what they buy, where, and how much. But learning about the whys of consumer buying behavior is not so easy—the answers are often locked deep within the consumer’s mind. Often, consumers themselves don’t know exactly what influences their purchases. “The human mind doesn’t work in a linear way,” says one marketing expert. “The idea that the mind is a computer with storage compartments where brands or logos or recognizable packages are stored in clearly marked folders that can be accessed by cleverly written ads or commercials simply doesn’t exist. Instead, the mind is a whirling, swirling, jumbled mass of neurons bouncing around, colliding and continuously creating new concepts and thoughts and relationships inside every single person’s brain all over the world.”

6. Model of Buyer Behavior
The environment
Buyer’s black box
Buyer responses
Marketing stimuli
Product
Price
Place
Promotion
Other
Economic
Technological
Social
Cultural
Buyer’s characteristics Buyer’s decision process
Buying attitudes and preferences
Purchase behavior: what the buyer buys,
when, where, and how much
Brand and company relationship behavior
The central question for marketers is as follows: How do consumers respond to various marketing efforts the company might use? The starting point is the stimulus-response model of buyer behavior shown in Figure This figure shows that marketing and other stimuli enter the consumer’s “black box” and produce certain responses. Marketers must figure out what is in the buyer’s black box.

7. Many levels of factors affect our buying behavior—from broad cultural and social influences to motivations, beliefs, and attitudes lying deep within us. For example, why did you buy that specific cell phone?

8. Our buying decisions are affected by an incredibly complex combination of external and internal influences.

9. Characteristics Affecting Consumer Behavior
Culture - the set of basic values, perceptions, wants, and behaviors learned by a member of society from family and other important institutions.

10. Subculture
A group of people with shared value systems based on common life experiences and situations.

11. Subculture
Many brands now target specific subcultures—such as Hispanic American, African American, and Asian American consumers—with marketing programs tailored to their specific needs and preferences.
Tailored – специально приспособленный

12. Targeting Hispanic Americans: Burger King sponsors an annual family-oriented FÚTBOL KINGDOM national soccer tour in eight major Hispanic markets across the United States.

13. Targeting Asian Americans: State Farm has developed comprehensive advertising, marketing, and public relations campaigns that have helped it to gain significant brand equity among Asian American consumers.

14. Social class
Relatively permanent and ordered divisions in a society whose members share similar values, interests, and behaviors. Social class is not determined by a single factor, such as income, but is measured as a combination of occupation, income, education, wealth, and other variables.
Permanent – постоянный, неизменный
Group - two or more people who interact to accomplish individual or mutual goals.

15. Word-of-Mouth Influence and Buzz Marketing
Word-of-mouth influence can have a powerful impact on consumer buying behavior. The personal words and recommendations of trusted friends, associates, and other consumers tend to be more credible than those coming from commercial sources, such as advertisements or salespeople. Most word-of-mouth influence happens naturally: Consumers start chatting about a brand they use or feel strongly about one way or the other.
Associates – товарищи, коллега
Tend – иметь склонность, иметь тенденцию, направляться
Credible- вероятный, заслуживающий доверия.

16. Buzz marketing
Buzz marketing involves enlisting or even creating opinion leaders to serve as “brand ambassadors” who spread the word about a company’s products.
Opinion leader - A person within a reference group who, because of special skills, knowledge, personality, or other characteristics, exerts social influence on others.
Enlisting – заручиться поддержкой
Exert - влиять

17. Online social networks
Online social communities—blogs, social networking Web sites, or even virtual worlds—where people socialize or exchange information and opinions.
Online Social Networks . Over the past few years, a new type of social interaction has exploded onto the scene—online social networking. Online social networks are online communities where people socialize or exchange information and opinions. Social net-working media range from blogs (Gizmodo) and message boards (Craigslist) to social networking Web sites (Facebook and Twitter) and virtual worlds (Second Life). This new form of consumer-to-consumer and business-to-consumer dialog has big implications for marketers.

18. Family
Family members can strongly influence buyer behavior. The family is the most important consumer buying organization in society, and it has been researched extensively. Marketers are interested in the roles and influence of the husband, wife, and children on the purchase of different products and services.

19. Family buying: Family buying roles are changing
Family buying: Family buying roles are changing. For example, 65 percent of men grocery shop regularly while women influence 50 percent of all new technology purchases. Technology companies are redesigning their products accordingly.

20. Roles and Status
A person belongs to many groups—family, clubs, organizations, online communities. The person’s position in each group can be defined in terms of both role and status. A role consists of the activities people are expected to perform according to the people around them. Each role carries a status reflecting the general esteem given to it by society. People usually choose products appropriate to their roles and status. Consider the various roles a working mother plays. In her company, she plays the role of a brand manager; in her family, she plays the role of wife and mother; at her favorite sporting events, she plays the role of avid fan. As a brand manager, she will buy the kind of clothing that reflects her role and status in her company.

21. Personal Factors
A buyer’s decisions also are influenced by personal characteristics such as the buyer’s age and life-cycle stage , occupation , economic situation , lifestyle , and personality and self-concept .
Lifestyle - A person’s pattern of living as expressed in his or her activities, interests, and
opinions.
Pattern of living – образ жизни

22. Lifestyle: Triumph doesn’t just sell motorcycles; it sells an independent, “Go your own way” lifestyle.

23. Economic Situation
A person’s economic situation will affect his or her store and product choices. Marketers watch trends in personal income, savings, and interest rates.

24. Psychological Factors
A person’s buying choices are further influenced by four major psychological factors motivation , perception , learning, beliefs and attitudes.

25. Motive (drive)
A need that is sufficiently pressing to direct the person to seek satisfaction of the need.
Perception
The process by which people select, organize, and interpret information to form a meaningful picture of the world

26. Maslow’s Hierarchy of Needs
According to Maslow, human needs are arranged in a hierarchy. Starving people
will take little interest in the latest happenings in the art world.

27. Learning
Changes in an individual’s behavior arising from experience.

28. Suppose the consumer buys a Nikon camera
Suppose the consumer buys a Nikon camera. If the experience is rewarding, the consumer will probably use the camera more and more, and his or her response will be reinforced . Then the next time he or she shops for a camera, or for binoculars or some similar product, the probability is greater that he or she will buy a Nikon product. The practical significance of learning theory for marketers is that they can build up demand for a product by associating it with strong drives, using motivating cues, and providing positive reinforcement.
Associating - соединять

29. Attitude - A person’s consistently favorable or unfavorable evaluations, feelings, and tendencies toward an object or idea. Belief - A descriptive thought that a person holds about something.
Descriptive –описательный, изобразительный
Consistently – последовательный, стойкий